The business of single family home rentals, once an almost totally Mom/Pop enterprise, has now become really big business and we can largely credit (a) "the great recession" that poured so many houses on the market at fire sale prices and (b) the inability of the current generation of 20-somethings to afford to buy homes due to heavy student debt and other reasons which, in turn, has greatly boosted demand for rentals.

The deal between two of the country's largest rental home owners is the biggest yet in the quickly consolidating rental home business.

The combined businesses, which have a value of about $10.7 billion, will be the largest private owner of single-family homes by far. The nearest competitor is American Homes 4 Rent (AMH) , which owns about 49,000 homes.

The merger comes after Invitation Homes and Starwood have spent the years since the financial crisis competing for properties in 10 of the 17 markets in which the new business will operate . . . .

The green are all cities with rent control and difficult eviction processes?

To quote the article:

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There’s an obvious trait these markets share: With the exception of Denver, they also top the list of the ten most expensive major housing markets in the country. And while rents are also high in these markets, home prices are higher.

Nationwide, the full purchase price of the average home is equivalent to 11 years of the median U.S. rental payment. In the most expensive markets, it would take almost double that length of time – more than 20 years of rental payments – to pay for the price of a home in full. If expected home and rent price appreciation were projected to be the same across all markets, we would expect all markets to have a similar price-to-rent ratio. But that’s not what happens: In more expensive markets, home values are a higher multiple of annual rental payments . . . .